January 9 2004 Copyright 2004 Business Research Services Inc. 202-364-6473 All rights reserved.

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Army Shelves Huge Outsourcing Plan

The Army has scrapped an ambitious plan to contract out up to 214,000 jobs, the largest outsourcing initiative undertaken by the Bush administration.

The plan, known as the “Third Wave,” was launched by then-Army Secretary Thomas White in October 2002. He said the goal was to focus soldiers and civilian Army personnel on warfighting and turn support services over to contractors. But White resigned last April and the effort quietly died.

“There is no Third Wave,” Army spokeswoman Jennifer Gunn told Set-Aside Alert. “As far as a new Third Wave or the same animal by a different name, it will be up to the new secretary of the Army.”

Air Force Secretary James Roche has been nominated for the Army position and is awaiting Senate confirmation.

However, Gunn added, “We are constantly looking at getting our soldiers back into their warfighting jobs.”

Secretary White had identified about 59,000 soldiers who were performing “non-core” functions as well as nearly 155,000 civilian employees, including legal, accounting, maintenance and communications functions. He ordered major commands to submit plans for “privatizing, divesting, competing using (OMB Circular) A-76, outsourcing using ‘alternatives to A-76,’ converting military spaces to civilian or contract, or transferring to other government agencies, non-core functions.” (SAA, 1/10/03)

More than 60 members of Congress wrote to White opposing the plan.

The initiative was a response to Defense Secretary Donald Rumsfeld’s call for additional outsourcing. Rumsfeld questioned why the military services should be cutting their own checks or making eyeglasses for soldiers. His remarks drew little attention, because he made them on Sept. 10, 2001, and they were seen overtaken by events.


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